4 February 1991 Administrative Letter 903406 F - Medical Expenses

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Dear Sirs:

Re: Advance Tax Ruling Request for,  24(1)

This is in reply to your request for an Advance Income Tax Ruling, on behalf of 24(1) As discussed in our telephone conversation of  1991 (Short 19(1) the request relies primarily on the facts and the circumstances are such that the pertinent facts either cannot be established at this time or are of a nature subject to change at any time.  As a result, we cannot comply with your request for an advance income tax ruling.  Your deposit of $250 will be returned to you in due course.  We will, however, offer you general comments which may be of some assistance.

24(1)

24(1)

24(1) attempts to meet standards equivalent to those required under the Nursing Homes Act (Ontario).

24(1)  Given that all residents of you ask whether the fees paid to 24(1) for medical care would qualify as medical expenses within the meaning of paragraph 118.2(2)(a) of the Income Tax Act, thus allowing the residents a medical expense credit under subsection 118.2(1) of the Act.  You also ask whether a medical expense amount is available under the provisions of paragraphs 118.2(2)(b) or (d) of the Act for amounts paid by those residents requiring full-time care where medical certification of the kind described in these paragraphs is obtained.

Our Comments

Paragraph 118.2(2)(a) of the Act requires that the amount be paid to "a medical practitioner, dentist or nurse or a public or licensed private hospital" and be in respect of medical or dental services.  No payments qualify for medical expense purposes under paragraph 118.2(2)(a) of the Act if the payment's to a senior's residence that is not a public or licensed private hospital even in the instance where a portion of a residents monthly-fee may be directly attributable to medical services.

Paragraph 118.2(2)(b) of the Act permits amounts paid for full - time care in a nursing home where the patient has a severe and prolonged mental or physical impairment that has been certified in prescribed form by a medical doctor.  Paragraph 118.2(2)(d) provides similar treatment to fees for full-time care in a nursing home for an individual who has been certified by a qualified medical practitioner to be a person who, by reason of lack of normal mental capacity, is and in the foreseeable future will continue to be dependent on others for his or her personal needs and care.  Where these requirements are met, it is our view that all regular fees paid to a nursing home qualify as medical expenses for the purposes of the Act.  Amounts levied for food, accommodation, nursing care, administration, maintenance and social programming qualify.  Additional personal expenses which are separately identifiable, such as hairdresser fees, are not allowable expenses.

An individual determination for each patient is required to determine whether the criterion in paragraphs 118.2(2) (b) and (d) of the Act is met. It is a question of fact whether the residence is a "nursing home" providing "full-time care".  It is our view that if the disabled individual does not require constant attendance, whether active or precautionary, then no amount can be included as a medical expense under paragraphs 118.2(2)(b) or (d) of the Act.  While there is no requirement that a "nursing home" be licensed as such, it is expected that there be qualified medical personnel in attendance of a calibre and in sufficient numbers to provide care to the resident patients on a 24-hours basis.

We have also considered whether fees paid by a resident of a senior's residence can qualify as medical expenses under paragraph 118.2(2)(e) of the Act.  It is a question of fact whether a retirement home is a "school, institution or other place" providing specialized equipment, facilities or personnel for the care, or the care and training, of individuals suffering from the handicap suffered by the individual.  It is also a question of fact whether the individual requires the equipment, facilities or personnel specially provided by the institution.  A deduction under paragraph 118.2(2)(e) of the Act is not available where the level of care is not specific for the handicap in question.

We trust the above comments are of assistance to you.

Yours truly,

for DirectorBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch